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Feb 10 Unite Students, the student accommodation
unit of Unite Group Plc, and Singapore sovereign wealth
fund GIC have bought Birmingham-based student housing provider
Aston Student Village for 227 million pounds ($283 million).
Property investors have been buying into student flats,
health centres and care homes, favouring their long leases and
steady tenants over retail and offices, which have been hit by
Britain's vote to leave the European Union.
"This is the largest single student property asset to have
ever transacted. It is a demonstration of the weight of capital
looking to access a sector which has a resilience to the general
economic cycle," James Pullan, Knight Frank's Head of Student
Property, told Reuters.
"The PBSA sector continues to attract equity from across the
globe," he added, referring to the purpose-built student
Property was among the sectors hit hardest by Brexit. Within
weeks of the referendum, seven commercial property funds worth a
collective 18 billion pounds froze trading after panicked retail
investors asked for their money back.
The London Student Accommodation Vehicle, a 50:50 joint
venture between Unite and GIC, is funding the deal with 40
percent equity and 60 percent debt, Unite Students said.
Aston Student Village (ASV) comprises 3,067 beds across five
properties on the Aston University campus.
The deal would expand Unite's presence to up to 5,000 beds
in Birmingham, the second-largest student city in the UK after
London, with over 70,000 students during term time.
ASV will generate gross annual income of around 17 million
pounds for the 2017/18 academic year and immediately add to
earnings and NAV, Unite said.
The purchase is expected to add 1-2 pence to the Unite
Group's earnings per share going forward, Unite Students said.
($1 = 0.8021 pounds)
(Reporting by Sanjeeban Sarkar in Bengaluru; Editing by
Gopakumar Warrier and Martina D'Couto)